New York, Feb 1, 2026, 06:34 (EST) — Market closed.
- Microsoft shares closed Friday down 0.8%, slipping to $430.29 following a steep drop the previous day.
- Traders remain focused on how quickly AI data-center investments ramp up and what returns cloud growth delivers.
- Coming up is a packed week with megacap tech earnings and key U.S. economic data on tap.
Microsoft shares ended Friday down 0.8% at $430.29, leaving the stock under pressure heading into the weekend after a tough two days.
That’s key since Microsoft now serves as a clear gauge for how much investors are willing to pay today for AI-driven growth requiring massive infrastructure investment. Once the market begins to doubt the cost, it usually drags more names down with it.
The stock fell 10% on Thursday, slashing about $360 billion from its market cap despite beating revenue and earnings estimates for the quarter. Microsoft revealed that nearly half of its backlog—future contracted revenue not yet recognized—comes from OpenAI, raising concerns over customer concentration and whether the startup can fulfill such sizable commitments. (Investopedia)
Investors focused on capex, or capital expenditures, which cover spending on long-term assets like data centers and hardware. CFO Amy Hood reported that “capital expenditures were $37.5 billion,” with about two-thirds of that directed toward short-lived assets such as GPUs and CPUs. (Office 365 for IT Pros)
Jordan Klein at Mizuho didn’t mince words, labeling the stock as “dead money” unless cloud growth picks up again, MarketWatch reports. (MarketWatch)
Friday’s session dragged the Nasdaq Composite down by 0.7%, while the S&P 500 edged lower by 0.1%. Tech stocks underperformed as investors shifted focus between earnings reports and rate-sensitive sectors. (Nasdaq)
Microsoft’s link to the wider AI funding wave is another key angle in the trade. Nvidia CEO Jensen Huang revealed plans for a “huge” investment in OpenAI, pushing back on rumors of tension with the startup as “nonsense.” OpenAI is currently pursuing a fundraising round that could peg its valuation around $830 billion. (Reuters)
The risk scenario is clear. If AI demand cools off or drags out before turning into billable cloud revenue, spending could squeeze margins and cash flow ahead of any sales boost, leaving the stock stuck. Plus, heavy reliance on a handful of major AI clients only deepens the uncertainty.
Peers could be the next catalyst. Alphabet and Amazon, both reporting this week, will offer cloud insights that might influence how investors view Microsoft’s demand outlook. (Investopedia)
Macro data takes center stage. On Feb. 6 at 08:30 a.m. ET, the U.S. Bureau of Labor Statistics will release the January employment report, a key event that typically influences rate forecasts and, in turn, investor appetite for high-multiple tech stocks. (Bls)
